The financial benefits of improving diversity and inclusion

Improving diversity and inclusion (D&I) in insurance companies has a positive impact on the business above and beyond compliance and the reputation of the organization, speakers said recently at a virtual industry event.

Some of the benefits include better talent and promotion opportunities, and greater innovation and employee engagement. Strong D&I data can even have a positive impact on share price, according to U.S. results from the Edelman Trust Barometer Special Report: Institutional Investors, released earlier this month.

“You won’t get to the best solutions if you don’t have diversity of thoughts and experiences,” said Rowena Chan, president of Sun Life Financial Distributors (Canada) Inc. and senior vice president of distribution, during KPMG’s 2020 Insurance Conference. “If we truly believe that people are created equal, why would you exclude a segment of talent in your recruitment, in your development, in your promotion opportunities?

Companies that do lose out on getting the best talent, she added. “Diversity — whether it’s race, sexual orientation, gender [or] age — is really about bringing in diverse perspectives, experience and knowledge. These are all good business reasons [over and above] compliance and reputation.”

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Mary Lou Maher, Canadian manager partner, quality & risk management and global head of inclusion & diversity with KPMG in Canada, agreed that bringing all voices to the table improves the business. “Why wouldn’t we want all of our people engaged and giving 100% on the job?” she asked. “It just doesn’t make any business sense, let alone morally … that you wouldn’t listen to all voices.”

Maher pointed to the “emotional tax” that those under-represented around the table might feel, making it a “big effort to bring their whole self to the table.

“Let everyone have a voice at the table,” she said. “That’s where innovation comes and everything great comes out of it. Why wouldn’t you want to get the best out of all your people?”

Michelle Taylor-Jones, vice president of global diversity, equity and inclusion at Manulife Financial, said diversity and inclusion shouldn’t just be about setting quotas or targets. “First and foremost, nothing measured, nothing done,” she said. “If we’re talking about changing the face of the organization to really mirror the marketplace as well as our customer base, we really need to have a goal.

“Organizations are very goal-based in terms of sales projections and products, so why shouldn’t [diversity, equity and inclusion (DEI)] and the DEI strategy be different?”

Related: The case for using data for diversity and inclusion in senior ranks

Chan referenced the Edelman report during her presentation, noting that seven in 10 respondents to the U.S. survey now apply exclusionary screening criteria based on D&I data. Ninety-two per cent of respondents either strongly agree (43%) or somewhat agree (48%) that strong D&I data have a positive impact on share price.

“So, where the company progresses and commits to D&I directly impacts the investor community,” Chan said. “This is a very strong signal for the board and senior management to pay attention to. It’s about clients and employees, but it’s also about investors.”

Chan also noted that she didn’t have any role models for the type of work she does: A general manager in a business.

“We’re not going to fix this in a year,” Taylor-Jones added. “There’s no silver bullet; there’s no magic pill. This is a journey and we’re not going to get here in a year. I would even venture to say it’s going to take us a decade to really get this right.”

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